So many choices, Part 2: Vendor transactions and more

This article is Part 2 of a two-parter on the transactions you can use in QuickBooks. Part 1 covers customers. This one covers vendors.

With vendors, it’s all about spending money. You need stuff to run your business, whether that’s new inventory or just paper clips. You can create any transaction for a vendor from the Vendors menu or from the Vendor Center.

You want to order things you’ll pay for later

Ordering goods or services to be paid for at a later time is a purchase order (PO). QuickBooks uses POs to track outstanding orders for you. Then, when you receive the items or the services are complete, you can mark them as received on the purchase order. Also, when you get the bill, you can just use the purchase order to enter the bill.

You receive the things your ordered and need to pay for them

OK, now you’ve received your order, and you’re ready to pay. You have a few choices on how you do that.

Check or Credit Card Charge. If you want to pay the bill right away, you can just write a check or use your credit card to pay the bill. You record these transactions with Write Checks or Enter Credit Card Charges on the Banking menu. Your balances reflect the payments right away.

Bill and Bill Payment. You may want to pay the bill later, say after you’ve received payments from your clients or because you pay all your bills at once. But QuickBooks should know you received this bill so that it can accurately tell you how much money you actually have. Use Vendors > Enter Bills to enter the information about the bill. Once you pay the bill, use Vendors > Pay Bills to enter the payment.

Item Receipt. If you receive the things you order but are getting the bill later, use an item receipt to tell QuickBooks you received the items. Use Vendors > Receive Items. Then when you get the bill later on, you can pay it right away with a check or credit card or enter the bill.

You have a credit from a vendor

Sometimes, a vendor may owe you money. You can then enter a bill credit. Choose Vendors > Enter Bills and select Credit at the top of the window. Then you can apply the credit when you pay a future bill from the vendor. You can also do the same thing for credit card credits. Use Banking > Credit Card Charges and select Credit in the window.

You need to pay your sales taxes

When you need to pay your sales taxes, use a sales tax payment (Vendors > Pay Sales Tax). QuickBooks records the sales tax payment for the organization you’ve set up as your tax agency.

Other transactions

And now we’re at the transactions that aren’t related to customers or vendors, but they still need a little love.

You have money to deposit or funds to transfer

When you deposit money or transfer it, QuickBooks needs to know about that.

Deposit. When you put money into your bank account, QuickBooks needs to know about it. Use Banking > Make Deposits to record the deposit. If you use Receive Payments to record payments from your customers, you can select the Group with Undeposited Funds option on the Receive Payments window and see those funds as deposits.

Transfer funds. If you move money from one bank account to the other, be sure to record that as well with Banking > Transfer Funds.

You make changes to inventory

If you track inventory in QuickBooks, you’ll probably need to make adjustments to how much of a thing you have or the value of that thing. So you’ll make an inventory adjustment (Vendors > Inventory Activities > Adjust Quantity/Value on Hand).

You want to make general journal entries

QuickBooks provides the general journal for bookkeepers who know debits from credits and who prefer to enter certain transactions in a general journal (Banking > Make General Journal Entries). If you’re unfamiliar with how a general journal works, you don’t need to make journal entries. This is just for those who are familiar with this method and want to keep using it.

So that’s it for transactions. I hope Part 1 and Part 2 of this article makes using transactions a little easier for you.

Shelly King works for Intuit as a member of the QuickBooks for Mac team. She’s the Managing Editor for Little Square and its main contributor. Shelly grew up in the South until 1994 when the Internet called her to Silicon Valley. She’s done a lot on the web ever since. Little Square was her idea. Yep, it’s all her fault. See all of Shelly’s articles